Skydance revises its offer for Paramount as exclusivity deadline nears

Skydance Media has reportedly put in its “best and final” offer to acquire Paramount Global, according to a Deadline report.

The new deal structure reportedly includes a cash infusion of $3 billion from Skydance and RedBird Capital, which appears to be an increase of around $1 billion from the previous proposal. 

The latest offer also reportedly includes a way for shareholders with non-voting Class B shares to realize at least some return, though further details were not available. Shari Redstone, who owns the majority of the company stock through National Amusements, would also come out of the deal with slightly less ahead.

The complex deal appears to be set to be structured first as Skydance buying a controlling stake in shares of Paramount. Including Class B shares would allow investors holding those shares to hopefully realize a premium on the stock value. 

Paramount would then turn around and buy Skydance using stock, potentially valued as high as $5 billion. Despite this new deal structure, it appears that Skydance CEO David Ellison, son of Oracle founder Larry Ellison, would head up the new company.

Paramount board prepares to remove Bakish as CEO as M&A talks continue

Previous reports indicated that Paramount is preparing for Bob Bakish, current CEO of Paramount, to exit, possibly via a resignation, as there does not appear to be plans for him to help lead the new company.

That proposal allows Paramount to get a quick injection of cash, something it needs as its debt ratings decline. 

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If Paramount’s board declines Skydance’s latest offer, there is still a chance Ellison and company could come back with a sweeter deal despite labeling it as its “best and final.”

Time is running out, however, on Skydance-Paramount’s exclusivity period, which is set to end May 3, 2024. The two companies could still continue to discuss terms after this date, but Paramount is also free to explore other options.

Sony Pictures and Apollo Global Management have reportedly partnered up and are prepared to offer an all-cash deal should the exclusivity period end without an agreement between Skydance and Paramount.

Some key investors have voiced concerns over the Skydance deal and it’s not clear if the restructured proposal would reduce any objections.